A short watch. 

In this video, Jim Cielinski, global head of fixed income at Janus Henderson, explains why he believes we are in a liquidity cycle-driven marketplace more than a standard economic-driven one, which will impact volatility and asset markets.

He holds the view that the credit cycle has ‘turned’ with a bottoming off of default rates and credit spreads relative to government bonds. This means more stress lies ahead with companies having less ability to grow through debt, though volatility in the fixed income market creates opportunities.

Acknowledging that the risk of the Federal Reserve overshooting and tightening too much has faded, he thinks policy makers will take more cautious approach this year – but there are big risks.

Jim also explain why he believes that politics is more important now to markets than in any other time in his career.